Westfield questions ACCC’s re-opening of old case

08 March 2002

Countries: Australia

Westfield Holdings today questioned the need for the ACCC’slegal action against the company over alleged breaches of the TradePractices Act.

In March 1999 the ACCC notified Westfield in writing that it hadfully investigated complaints by former tenants, who operated aretail shop in one of Westfield’s Queensland shopping centres. Theformer tenants had alleged that misrepresentations had been made byWestfield executives during pre-lease negotiations. The ACCC hadconcluded that Westfield had not contravened any provision of theTrade Practices Act.

The ACCC advised that it did not intend to take theinvestigation further.

The tenants proceeded with their claims before the QueenslandRetail Shop Leases Tribunal.

In June 2001 Westfield and the tenants negotiated a compromiseand, subject to a formal deed of release being signed, theproceedings were to be terminated.

Westfield agreed upon the compromise on the faith of the aboveclearance from the ACCC that there had been no breach of the TradePractices Act and that the ACCC did not intend to take the matterfurther.

Clayton Utz, solicitors for Westfield in this matter, submitteda deed of release to the solicitor for the tenants and afterdiscussions a final deed was agreed upon.

Then, without notice, the ACCC wrote to Westfield on 26 July2001 asking a series of questions about the original complaints.This was the first time Westfield had heard from the ACCC since theclearance provided in March 1999.

Westfield then contacted the ACCC to ascertain whether it wasaware of the compromise reached with the tenants and whether inlight of that information it would be continuing itsinvestigation.

The ACCC now alleges that Westfield’s communications with it andthe deed of release were intended to prevent any furtherinvestigation by the ACCC. This is plainly wrong. Westfield fullyco-operated in the original investigation by the ACCC and thesettlement of June 2001 was agreed only after the ACCC had giventhe written clearance that it had completed its investigation.

Westfield will be strongly defending the ACCC’s legalaction.